How much student loan debt is too much?

[casualrunnergal]

Given that social worker salaries seem to vary from about $40,000 to, eventually, about $80,000, how much debt would you consider taking on for an MSW program?

 

My circumstances are that I don't have any debt from undergraduate. I have a decent amount in savings, plus an Americorps education award, that would allow me to pay for the first year of a private program. However, I would be taking out loans for the second year, and, factoring in living expenses, this could well be about $50-60,000.

 

Would you consider this too much? What would be the upper limit for you when it comes to student loan debt?

 

Thanks for any and all feedback, it's much appreciated!

[Figaro]

I'm trying to determine the answer to this question, too. It all depends on what you find to be "too much."

I intend to use the Income Based Repayment plan (IBR) and the Public Service Load Forgiveness program.  Just about any job I would end up taking would qualify for PSLF, therefore, the balance of the loan would be forgiven in ten years after 120 consecutive payments.  With a job at about $50-55, which is what I am shooting for and what I am thinking is reasonable with my particular specialty, the monthly payment would be about $350. a month with a $75,000 total debt. My family is going to help, so I find that amount manageable.  It's still scary.  If I choose to attend a more expensive, completely private university for my MSW, that will require about $90,000 in debt for the MSW, and I have about $25,000 from the undergrad education to add to it, for a grand total of about $115,000 in debt.  That would be more without family paying for my apartment and support while I'm there for the MSW.  HOWEVER, if the monthly payment is still the same (under IBR) AND the balance is forgiven in ten years, then the amount of the debt isn't as vital because it's going to cost me the same in payments whether the total debt is 75 or 115. I would have to stay in qualifying employment for ten years, but that seems easy to do.  It does involve worrying about Congress ending the PSLF program, but that seems highly unlikely that they would end it after people made their plans depending on it. The outcry would be too great.  If they ended it, they would have to do it at some point in the future.  On the other hand, without the MSW, my job prospects would stink.  This is what it takes to be competitive for jobs. Something else to consider is the living cost of where you want to live.  The military pays off student loans for social workers, so that's also an option if you want to serve there for a few years. My family and I are going over all this information to try to figure out whether to go to Penn or Pitt (both are fantastic), and I'm still not sure of what to do. It's really hard. Good luck.

[U-M_Detroiter]

I'm trying to determine the answer to this question, too. It all depends on what you find to be "too much."

I intend to use the Income Based Repayment plan (IBR) and the Public Service Load Forgiveness program.  Just about any job I would end up taking would qualify for PSLF, therefore, the balance of the loan would be forgiven in ten years after 120 consecutive payments.  With a job at about $50-55, which is what I am shooting for and what I am thinking is reasonable with my particular specialty, the monthly payment would be about $350. a month with a $75,000 total debt. My family is going to help, so I find that amount manageable.  It's still scary.  If I choose to attend a more expensive, completely private university for my MSW, that will require about $90,000 in debt for the MSW, and I have about $25,000 from the undergrad education to add to it, for a grand total of about $115,000 in debt.  That would be more without family paying for my apartment and support while I'm there for the MSW.  HOWEVER, if the monthly payment is still the same (under IBR) AND the balance is forgiven in ten years, then the amount of the debt isn't as vital because it's going to cost me the same in payments whether the total debt is 75 or 115. I would have to stay in qualifying employment for ten years, but that seems easy to do.  It does involve worrying about Congress ending the PSLF program, but that seems highly unlikely that they would end it after people made their plans depending on it. The outcry would be too great.  If they ended it, they would have to do it at some point in the future.  On the other hand, without the MSW, my job prospects would stink.  This is what it takes to be competitive for jobs. Something else to consider is the living cost of where you want to live.  The military pays off student loans for social workers, so that's also an option if you want to serve there for a few years. My family and I are going over all this information to try to figure out whether to go to Penn or Pitt (both are fantastic), and I'm still not sure of what to do. It's really hard. Good luck.

Do you mind if I ask what specialty you are going into that would put you at $50-55??

[Lifesaver]

I wish I could be as calm as everyone else about this. I'm not getting financial help and I still have $18,000 in federal loans on top of the $150,000 or more I'll end up with after this masters. Even 120 payments is scaring the heck out of me. $600 (or more) a month is still almost double my car payments each month! I just can't wrap my head around all this.

[Goobah]

I think the general advice is not to get into more debt than you expect to make in a year.  For example (and to answer UM Detroiter's question) I am looking at medical and health social work -- that starts at about $50,000 a year.   I wanted to make sure I did not take on more debt than that.  I've heard several professions use that rule of thumb.

[Lifesaver]

Hard to make that rule of thumb work with private school or out of state tuition. And no substantial funding. Great plan for those with wonderful in state universities, not so much for the rest of us.

[guyinshortsallday]

I wish I could be as calm as everyone else about this. I'm not getting financial help and I still have $18,000 in federal loans on top of the $150,000 or more I'll end up with after this masters. Even 120 payments is scaring the heck out of me. $600 (or more) a month is still almost double my car payments each month! I just can't wrap my head around all this.

 

 

I am in your shoes. I am waiting for other schools and also seeing if I can get a better financial package. I am not about to get into 100K debt. I hope you don't either. 

[casualrunnergal]

I think the general advice is not to get into more debt than you expect to make in a year.  For example (and to answer UM Detroiter's question) I am looking at medical and health social work -- that starts at about $50,000 a year.   I wanted to make sure I did not take on more debt than that.  I've heard several professions use that rule of thumb.

This is very helpful, thank you! It also makes me feel a lot better about the amount of debt I'm expecting to take on.

[Figaro]

Lifesaver: I read somewhere that there are some schools with MSW programs that don't charge more for out-of-state students, but I don't know which ones they are. I do sympathize with you on that. Like you, there's no way I could keep my debt load at $50,000 - 55 to get an MSW. That would have only been possible if I didn't have any debt from my undergraduate degree.  I can't finish my education without being at least $75,000 in debt. So, it's a risk to do it and it's a risk NOT to do it, because I won't get a decent job without it or be able to compete with MSWs for any jobs. I don't take the debt level lightly either.  It's terrifying. However, if you are too uncomfortable about it, then don't do it. Don't do it if you aren't sure this is right for you. Each person has their own factors to consider, like other debt, level of family financial support, projected income at graduation and the cost of living where you want to live. I read about other people getting these tasty financial packages but they seem to mostly be living in MA and attending Boston area schools. I can't get crap in the way of aid other than loans. Just try to plan now for how you'll pay back the loans. That's why I'm studying the loan forgiveness programs and income based repayment plans. Personally, $600 a month for ten years would be too much for me, too.  I think that If you're going to be over $150,000 in debt with all the other educational debt you have, that's too much for anyone unless you're a doctor. Unless the monthly payments would be manageable with the income based re-payment and the loan forgiveness programs. Check those out before you decide.  After we're all through this, we really have to get active in working to increase the way people look at social workers and the value of them as professionals worthy of incomes commensurate with the level of education the jobs require.

[citychild]

I think everyone's situation is different and managing debt capped at one year income as a social worker isn't always feasible. When I started my education, I wanted to be a lawyer--and my parents refused to sign the FAFSA, so I had to wait until I was 22 to start. Needless to say, 1 year of school on a lawyer track was about $35k alone. I left school after that for awhile and when I returned, I was on the social work track. Without a supportive family, working full-time to pay my living expenses isn't exactly feasible for me (for some yes, not for me for various reasons). I chose a graduate school that met my needs, including living in a city where I could sell my car.

I will end with about $90k of loans, when all is said and done after my Master's degree. Am I scared? Absolutely. Is there much I can do about it? No. I am considering Americorps, since when the term is completed, I will get an education award to help pay off my loans. I am also considering the National Health Service Corps.

[beyond_dreamz]

Lifesaver: I read somewhere that there are some schools with MSW programs that don't charge more for out-of-state students, but I don't know which ones they are.

 

From what I can tell, I believe Columbia U. is one of these schools. I'd first thought I just must not have looked thoroughly enough, but yeah, so far only set of tuition and fees listed. Well, two -- it seems they only break them out by full-time and part-time; not in-state and out-of-state.

 

So, pretty much, crazy, out-the-booty costly for eeeeeeeeverybody!  

[tigergal8993]

From what I can tell, I believe Columbia U. is one of these schools. I'd first thought I just must not have looked thoroughly enough, but yeah, so far only set of tuition and fees listed. Well, two -- it seems they only break them out by full-time and part-time; not in-state and out-of-state.

 

So, pretty much, crazy, out-the-booty costly for eeeeeeeeverybody!

As a private university, Columbia wouldn't have in-state/out-of-state tuition differences. Those apply strictly to state universities.  

[briefinterviews]

PSLF may be undergoing some changes, beginning in 2015:

 

http://www.edcentral.org/obama-administration-announces-major-reforms-income-based-repayment/

 

Changes are unlikely to impact those of us already en route to using PSLF in its current form--i.e. complete loan forgiveness after 120 qualifying payments, and no tax bomb at the end of the tunnel.

Edited March 11, 2014 by briefinterviews

[mch16]

is anyone else concerned about finding a job that would fit the PSLF criteria but that would also provide clinical supervision towards licensure? most of the PSLF jobs seem to be government sponsored or govt agencies, and in those situations it seems that you wouldn't be doing clinical work or have a LCSW to supervise you.

[Lifesaver]

I was under the impression that PSLF covered any federal or state government organization, any non-profit organization, and something about religion based organizations. I'm sure there are PLENTY of clinical jobs with supervision that fall under those categories. Any public hospital, public school, public health clinic, etc.

[ontheswpath]

Lifesaver is correct. And there are a lot of non-profits with clinical work and supervision (at least in CA and prob major cities ?), but non-profit pay typically doesn't pay all that well until you are licensed or move to management position (which many times requires licensure).

[KNik]

I agree with the "do not take out more than you expect to make" motto. I get having limited state schools and private schools being expensive, but if you do your research and some basic math you can go to a great school with minimum debt. Which schools are the least expensive? Which schools are known for giving the most financial aid and award? Which cities are less expensive to live in? These I believe are important questions to ask.

[cuisinequeen7]

My two cents: I only applied to cheaper State schools because as an individual who already struggled to pay off 25k for an undergrad at UCLA, I am now very afraid of getting more into debt.  In addition, I scared the crap out of myself because I googled "student loan horror stories" and read THOUSANDS upon thousands of sad tales regarding the debt trap that hopeful students fall into and can't crawl out.  I will be turning 29 soon and I currently have a negative net worth -- which frankly sucks. My hope is to graduate as soon as possible with minimal debt so I can start building my life, saving for retirement, etc. 

 

I really don't think pricey out-of-state or brand name schools matter much in this field, unless of course the individual has lofty goals of going into top management or academia.  From what I hear, experience and individual capabilities matter more in getting a good job.  MSW's really don't make much money and I cringe at the estimated 45k (undergrad+grad) loans that this degree will cost me.  In response to the first poster, 50k max is probably the most I'll pay for an MSW.  No more.